Concernedly, Aaron Nichols strolled through rows of kale on his farm, his brown rubber boots stained with some of the earth’s best dirt. A massive Intel building loomed over the horizon. Intel is a manufacturer of semiconductors.
About 50 years ago, Oregon passed the first statewide legislation in the United States to limit urban expansion, protecting the farmland and woods surrounding the state’s major towns. Cities cannot grow beyond such boundaries without a formal request and justification.
Local government permission might take a long time, perhaps years (more significant expansions also need approval by the Oregon Department of Land Conservation and Development).
To entice semiconductor makers to set up shop in Oregon, the state legislature is now considering a measure that would give the governor the power to extend these borders unilaterally. The legislation would also provide chipmakers grants totaling $200 million. The idea has farmers and environmentalists in a state that values its open areas very concerned.
“One of the reasons we bought our farm right here is that we knew that for 50 years we’d be farms, and everyone around us would be farms,” Nichols said. “And now we’re not so sure. Now it’s up to one decision by the governor. And that’s a scarier place to be.”
Yet, Oregon’s government is keen to attract new semiconductor manufacturing facilities while billions of dollars in federal financing are available to support the sector’s growth. It hurt their feelings when Intel decided to spend $20 billion on a chipmaking plant in Ohio instead of Oregon, where the suitably zoned property is rare.
In contrast to California’s Silicon Valley, Oregon’s “Silicon Forest” has long been the hub of semiconductor R&D and manufacturing. But, Oregon faces competition from other states if it wants to attract multibillion-dollar semiconductor fabs.
Once the CHIPS Act was enacted in 2022, allocating $39 billion to corporations building or expanding facilities to produce semiconductors and those that assemble, test, and package the chips, the level of competition increased dramatically.
The Oregon Semiconductor Competitiveness Task Force stated in a report published in August that a significant increase in semiconductor design and manufacturing in Oregon would result in tens of thousands of high-paying construction jobs and thousands of manufacturing and supply chain jobs.
The task panel cautioned that Oregon needed additional buildable industrial acreage near infrastructure, bright labor, and specialized suppliers to recruit and maintain semiconductor manufacturers.
“This is about generational change,” Democratic state Sen. Janeen Sollman, a chief sponsor of the bill, said during a recent tour of an HP Inc. campus in Corvallis, Oregon. “This is the opportunity that students will have for their future in going into these jobs.”
Several states surround their towns with vast retail complexes and housing projects. However, in Oregon, owing to a past Republican governor, you can leave the city and be in agricultural or ranch country within minutes of driving. Tom McCall, governor of Oregon from 1967 to 1975, strongly advocated keeping the state’s beaches open. He advocated for a strict new land-use regulation to be passed in 1973.
“Sagebrush subdivisions, coastal ‘condomania’ and the ravenous rampage of suburbia here in the Willamette Valley all threaten to mock Oregon’s status as an environmental model of this nation,” McCall said in a speech before the Legislature in 1973.
The legislature obliged, enacting the country’s first statewide urban development boundary policy measure. The states of Washington and Tennessee quickly followed Oregon’s example. A repeal was first proposed on an Oregon ballot in 1982.
McCall, who had cancer and was dying of it, fought against it. Two months before McCall’s de@th, voters rejected the proposition, upholding Oregon’s land-use system. A city’s urban growth boundary in Oregon specifies the area into which it plans to expand during the following two decades.
Once the property is part of a UGB, it might be annexed by a municipality. There is constant growth in those UGB lines. The Oregon Department of Land Conservation and Development reports that 35 applications were accepted between 2016 and 2021.
Nonetheless, patience is required, and according to Robert Parker, the director of the strategy at the University of Oregon’s Center for Policy Research and Engagement, McMinnville, located in the state’s renowned wine region, fought for 20 years to extend its border.
According to Gordon Howard of Oregon’s land conservation agency, the clearance process might take months to years, depending on the amount of dispute. Court or state board appeals add even more time to the process.
For chip manufacturers, particularly those interested in CHIPS Act grants, that’s too long to wait. “Other states offer a more streamlined approach that is more in sync with the speed of the market,” according to Oregon’s semiconductor task force, whose members included then-Gov. Kate Brown.
Under the law, the governor may design two locations more prominent than 500 acres (202 hectares) and six smaller sites for UGB expansion. The state’s highest court hears all appeals. Lands already within the urban development limit were recommended as the campaign’s primary target by the Oregon Farm Bureau, which represents 7,000 family farmers in the state.
“The conversion of agricultural lands into paved industrial lands is a permanent destruction of our natural and working lands,” said bureau Vice President Lauren Poor. “Once it’s paved, the soil and its ability to sequester carbon, support our food system, and generate income for Oregonians is gone forever.”
According to Nicole Anderson, an associate professor in the Department of Crop and Soil Science at Oregon State University, Washington County, where Nichol’s farm is situated, produces more clover seed crops than anyplace else in the world due to its unique soil and wet environment.
“I hope that science and consideration of our land resources are considered when this bill is voted on,” Anderson told the Legislature’s joint committee on semiconductors on March 13. The measure was forwarded to the Senate floor for a vote on Friday by the ways and means committee. This week, the Senate will take up the priority bills.
“I am thrilled to see this legislation pass out of committee and look forward to seeing it through to the finish line,” said Rep. Kim Wallan, a Republican and a chief sponsor of the bill. Expert in land use, Parker is not convinced that its acceptance would spell the end of Oregon’s cherished policy.
“Will there be more challenges and bumps in the road ahead? Yeah, I think so,” Parker said. “But I feel like it is so well established in the state at this point that it has the inertia to carry it through those challenges.”
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